The Volatility Index (VIX) is exhibiting a potential bottoming pattern as it looks like the entire move down from the late 2008 high an 'ABC" affair. Furthermore "C" looks to be developing a possible Ending Diagonal pattern. If we are seeing an Ending Diagonal pattern in the VIX then a strong upside reversal would occur once the final 5th Wave down completes.
Meanwhile looking at the Weekly Line Chart of the S&P 500 still shows a potential Broadening Top pattern. If that's the case then the S&P 500 would make one more slightly higher high before undergoing a more significant correction in the Fall.
A similar looking Broadening Top patterns may be developing in the Nasdaq as well.
Keep in mind Broadening Top patterns are not very common with the last major one occurring in the early 1970s which was followed by a 50% sell off. However even if we see a decent correction in the Fall I don't expect it will be nearly as severe as the one that occurred in the early to mid 1970's.
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